GOP budget resolution calls for pay freeze through 2015

By Kellie Lunney and Emily Long

April 5, 2011

The chairman of the House Budget Committee on Tuesday called for a federal pay freeze through 2015 and a slowdown in government hiring as part of an overall effort to cut trillions of dollars in spending during the next decade.

The GOP's fiscal 2012 budget resolution recommends a freeze on federal pay through 2015, and an attrition policy that permits the government to hire only one new employee for every three workers who retire. The resolution estimates that by 2014, the hiring reform will produce a 10 percent reduction in the federal workforce.

"Federal workers deserve to be compensated for their important work, but pay levels, pay increases and benefit packages need to be reformed in line with the private sector," the resolution said. President Obama and Congress agreed on a two-year pay freeze for federal workers, which took effect in January.

The House budget resolution argues the pay and benefits packages of federal employees are much more generous than those in the private sector. "Immune from the effects of the recession, federal workers have received regular salary bumps and cost-of-living adjustments, regardless of productivity or economic realities," the document said.

Several observers said the proposal incorrectly characterizes the growth of the federal workforce in recent years. The plan does not take into consideration retirement from federal service, nor does it take into account the heavy distribution of new jobs to the Defense, Homeland Security and Veterans Affairs departments, they said.

"When you're trying to figure out what kind of workforce you need, you don't start by picking some arbitrary number," said John Palguta, vice president for policy at the Partnership for Public Service. "You take a look at what you need government to do. The notion that we're going to fill only [one] out of every three jobs -- it's a terrible way to manage."

The plan also recommends requiring federal employees to pay for half the defined benefit they receive with their pensions at retirement, an increase from the current contribution of 0.8 percent of payroll.

According to Jessica Klement, government affairs director for the Federal Managers Association, workers would contribute a larger share of their Federal Employees Retirement System pension but would see no additional benefit in retirement. The proposal essentially amounts to a 5 percent pay cut, she said.

The National Treasury Employees Union promised an aggressive fight against the GOP resolution. "Elected leaders of our national government should stop putting forth the argument that federal agencies can meet the needs and expectations of the American people with even less resources and staffing than they have now," said NTEU President Colleen Kelley. "That logic defies common sense and reality."

Overall, the resolution asserts that the proposals aimed at federal employees would save about $375 billion during the next 10 years.

"The reforms called for in this budget aim to slow the federal government's unsustainable growth, and reflect the growing frustration of workers across the country at the different set of rules enjoyed by the government," the resolution said.

Budget Chairman Paul Ryan, R-Wis., announced the plan, which outlines the major spending categories his party believes the government should address, including streamlining executive agencies and eliminating certain government programs (in particular the health care law); reforming Medicaid, Medicare and Social Security; and simplifying the Tax Code. The proposal would reduce spending on domestic government agencies below 2008 levels and freeze that spending for five years.

The GOP budget resolution also supports Defense Secretary Robert Gates' plan to reduce inefficient spending at the Pentagon by $178 billion.